Free Trade

[cannon_fodder]

Keep America Open to Trade - WSJ
By CARLOS M. GUTIERREZ and ARNOLD SCHWARZENEGGER
http://online.wsj.com/article/SB121055661828684155.html?mod=opinion_main_commentaries

A short and to the point defense of Free-Trade.  In one sentence:  We gain more from trade than we lose.   More jobs, more money, more skilled labor, and a high standard of living.

For every job in the United States that we "protect" with trade restrictions and tariffs, we predictably lose jobs in other sectors.  The steel industry being a prime example - by protecting steel jobs we hurt jobs in the auto industry, construction, pipeline, boiler, ship building, and a litany of other industries that use steel.  At the end of the day, we lost a net of US jobs, cost US consumers more money, and at the end of the day allowed our steel industry to become non-competitive on the global stage - a very predictable outcome.

The flaw lies in a mercintilist zero-sum world view.  When in fact, the world generates new wealth constantly.  We can happily import $100 Billion of crap from China if it frees our labor pool to generate $250 Billion of wealth. Since the "giant sucking sound" of CAFTA went into effect the US has added 2 million jobs to our economy, 60% at wages over the national median.

Ignorance and fear rule calls for protectionism.  Recently the Columbian Free Trade agreement was destroyed by populace opinion, an act of pure and utterly foolish ignorance.  Under current law Columbia has open access to US markets, but Columbia can tax US imports; the CFT agreement made both markets open by forbidding Columbian taxes on US goods.  But fear of things you don't understand or refuse to learn about has ensured that for a couple more year Columbia remains a restricted market for US goods in exchange for a little pandering at home.

Sorry for the ramble, but as the campaign season drags on I get tired of hearing pandering to the populace on trade arrangements.   As if government protection of inefficient jobs will somehow keep them viable for the future.  The above article is a simple explanation of some of the results of trade (trade = you have what I want, I have what you want, in the end we BOTH gain).